Hi!
I hope I can offer some insight with the the experiences I have had.
I downloaded Ajax Beta 2 and installed it onto my Vista RC2 machine at home. Then downloaded the new Control Toolkit and everything was working great.
So I installed Beta 2 onto my web server (Windows Server 2003), uploaded the new Toolkit dll and revised web.config and discovered exactly the same problem as you guys are mentioning.
So I had a look at the contents of the folder at C:\Program Files\Microsoft ASP.NET\ASP.NET 2.0 AJAX Extensions\v1.0.61025 on my local machine and did indeed find the file "Microsoft.Web.Extensions.Design.dll"
Then I took a look at the same folder on my server and the file was missing (as was the entry in ther GAC).
So I uninstalled AJAX Beta 2 from both machines and tried again..
And again "Microsoft.Web.Extensions.Design.dll" was installed OK on my local machine but not on my server.
So I did it again just to make sure with the same result.
Result:
"Microsoft.Web.Extensions.Design.dll" is part of the Ajax Beta 2 installation package but will not install on some machines.
So I've gone back to Beta 1